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How Valeant Subsidiary Bausch + Lomb Performed in 3Q17

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Bausch + Lomb revenue trends

In 3Q17, Valeant Pharmaceuticals’ (VRX) subsidiary specializing in eye care, Bausch + Lomb, generated revenues of $1.25 billion, which reflected a ~1% growth on a YoY (year-over-year) basis. In 3Q17, Bausch + Lomb reported 6% YoY international organic growth.

In 3Q17, Bausch + Lomb’s vision care, surgical, consumer, and branded ophthalmology segments reported revenues of $208 million, $161 million, $392 million, and $149 million, respectively, compared with $198 million, $155 million, $401 million, and $162 million in 3Q16.

In 3Q17, Bausch + Lomb’s vision care, surgical, consumer and branded ophthalmology segments witnessed a ~5% rise, a 4% rise, a 2% fall, and an 8% fall on a YoY basis.

In 3Q17, Bausch + Lomb reported a non-GAAP (generally accepted accounting principles) gross profit of $759 million, compared with $761 million in 3Q16. In 3Q17, Bausch + Lomb’s gross profit remained flat YoY.

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In 3Q17, Bausch + Lomb reported a non-GAAP gross margin of 61%, similar to what we saw in 3Q16. In 3Q17, Bausch + Lomb reported non-GAAP EBITA and EBITDA (earnings before interest, tax, depreciation, and amortization) margin of $387 million and ~31%, respectively, compared with $383 million and 31% in 3Q16.

Expense trends

In 3Q17, Bausch + Lomb reported non-GAAP G&A (general and administrative) and non-GAAP R&D (research and development) expenses of $47 million and $14 million, respectively, compared with $46 million and $23 million in 3Q16.

In 3Q17, Bausch +Lomb reported non-GAAP operating expenses of $372 million, compared with $378 million in 3Q16.

Bausch + Lomb’s peers in the eye care market include Novartis’s (NVS) subsidiary Alcon, Johnson & Johnson (JNJ), and Abbott Laboratories (ABT). In 3Q17, Alcon, JNJ, and Abbott Laboratories reported revenues of $1.5 billion, $19.7 billion, and $6.8 billion, respectively.

The revenue growth of Valeant’s Bausch and Lomb is expected to boost the share prices of the Pharmaceutical ETF (PPH). Valeant Pharmaceuticals makes up about ~5.25% of PPH’s total portfolio holdings.

In the next part, we’ll discuss the performance of Bausch + Lomb’s top products in 3Q17.

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